New year means new financial goals in 2023. If you’re one of the many people making New Year’s Resolutions, consider adding some financial prospects to that list. While hitting the gym three times a week will help you achieve physical health, gaining financial health is also worth the effort. From improving your credit score and paying off credit card debt to achieving complete financial freedom, here are 7 resolutions to help improve your bank account in 2023:
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1. Save More Money
It’s no surprise that saving money is at the top of the list, however, this will look different depending on your current financial state. For example, if you don’t already have a TFSA (Tax Free Savings Account) open with your bank, this can help you save and earn money simultaneously. By setting up a bi-weekly automatic deposit, you will further your savings and even gain appreciation if you use that money to invest. Or use your credit cards to your advantage and earn cash back, travel points, air miles, and more. Whether it’s through a TSFA or RRSP (Registered Retirement Savings Plan), budgeting or advantageous credit card use, speak with your CPA tax firm to explore your money saving options.
2. Improve Your Credit Score
Perhaps you want to improve your financial standing with banks, landlords, and lenders in 2023. You can do as much by working on your credit score. In Canada, credit scores range between 300 to 900. Anything below a score of 574 is considered poor, making you a high risk when it comes to credit applications. To improve your credit score, accounting firms in Vancouver will advise that you:
- Pay your bills on time and in full, perhaps through auto deposit
- Pay off debt
- Limit the number of accounts you open
- Minimize spending
3. Evaluate Your Personal Budget
While the phrase “make a budget” sounds restricting to many, it’s a tool that you can use to track your expenses and improve your finances. This doesn’t need to be a cut and dry, constricting plan. Rather, if you view a budget as a guideline, it can give you a sense of control over your spending. To build a budget that works for you, write down your fixed expenses such as rent/ mortgage, bills (electrical, phone, internet, etc.), groceries, and savings. From there, you can accurately evaluate the funds leftover for miscellaneous costs including restaurants, clothing, entertainment, travel, and so on.
4. Add a New Source of Passive Income
The more passive income you earn, the less dependent you’ll be on your full-time job. For example, if you can reach the point where your fixed expenses can be paid with your passive income, your full-time gig is supplementary, granting you financial freedom. You can also pursue a variety of side-hustles to further your income such as creating an e-commerce store or starting a blog. Some common sources of passive income include:
- Opening a high-interest savings account
- Investing with a Robo-Advisor
- Investing in real estate
- DIY investing
- Using cash back apps
5. Get Fit from Home
Since the pandemic limited gym access, less than one-third of gym members returned post-covid in Canada. This is a smart move if you’re not an avid gym-goer. If you can’t find the motivation to work out from home (or outdoors for free), then why pay thousands of dollars per year for a gym membership that goes unused? If you’re gung-ho about working out in 2023, start with free workouts and then invest in a membership once you have the routine down pat.
6. Learn How to Cook
You don’t need to go from microwaved meals to Julia Child overnight. However, learning how to cook 10-15 of your favourite meals will not only improve your basic skills, but it can also save you money as well. While restaurants can be a fun indulgence, they’re often overpriced (and over buttered). By cooking at home, your physical and financial health will reap the benefits.
7. Meet With CPA Firms in Vancouver
To gain clear and accurate insight into your finances, speak with an accountant at Genesa CPA. Our team can share our skills, knowledge, and experiences to help you achieve high levels of growth and financial health. From accounting services and tax preparation to financial consulting, our CPA Tax Firm can make your 2023 resolutions a reality. Contact an accountant today!